Get smarter on supply chains

ARTICLE: Coke Acquires North American Unit of Bottler, By MICHAEL J. de la MERCED, New York Times, February 24, 2010

Good example of a major retailer seeking more control over its own supply chains--a growing trend that suggests, as I wrote a while back in a WPR column, globalization's tightening up in the search for greater efficiency. Dovetails with the larger verticalization trend cited previously here.

The great blog to follow in this regard: Lora Cecere's Supply Chain Shaman (which I'm adding to the sidebar). Steve and I met her for a dinner late last year, and she blew me away with her knowledge and analytical heft. Her blog is an education worth getting.

Lora has since done some work for Enterra that's guiding a lot of our strategizing as we make a major, paradigm-shifting market-entry effort in this realm.

I could not be more excited to be part of this push

Again, this is why I dismiss the de-globalization argument. It simply does not match what I'm seeing in the private sector.

Baby steps with Russian Afghan assistance possiblity

ARTICLE: AFGHANISTAN: NATO PROBING POSSIBILITY OF RUSSIAN ARMS ASSISTANCE FOR KABUL, By Richard Weitz, EURASIA INSIGHT, 2/24/10

Old classmate Richard Weitz on a logic that will not die:

The North Atlantic Treaty Organization and Russia are probing a deal under which Moscow could provide the Afghan military with helicopters and possibly others forms of assistance. In return, Russia might gain a voice in the shaping of international security policy for Afghanistan, NATO Secretary-General Anders Fogh Rasmussen told EurasiaNet.

Good stuff to see, and if the Americans are incapable of such leaps-of-logic, just fine for the more pragmatic Europeans to take the lead.

Still, this is a baby step compared to what logically comes next:

When pressed about developing a possible direct relationship between NATO and the CSTO -- or with the Shanghai Cooperation Organization, another multilateral group in which Russia plays a leading role -- Rasmussen was guarded. He made clear he did not soon envision establishing formal ties between NATO and the CSTO. In addition, he noted that some Atlantic Alliance members, acting in an individual capacity, had established contacts with the CSTO, including the dispatch of observers to attend periodic "Kanal" counter-narcotics operations.

But you gotta crawl before you walk.

(Via WPR's Media Roundup)

Carry-on cash (millions)

ARTICLE: Officials puzzle over millions of dollars leaving Afghanistan by plane for Dubai, By Andrew Higgins, Washington Post, February 25, 2010

One hopes this isn't a situation as brazen as suggested by the brief facts here.

One inescapable reality: cash is king in frontier economies, because rule-set avoidance is the norm--not the exception. International travel is just the logical modern upgrade from caravans/stage coaches/etc. The strongbox now is just your carry-on luggage, like that Chinese guy with $1.1m in euros.

(Via WPR's Media Roundup)

Cheney the survivor

ARTICLE: Former vice president Cheney released from hospital after fifth heart attack, By Rob Stein, Washington Post, February 25, 2010

I do love all that stuff about how Cheney keeps surviving heart attacks. It just warms my heart that that nasty f--ker refuses to die!

Good for him and everybody else who manages to do the same.

Life under Kim Jong Il

WORLD NEWS: "Pyongyang Reports an Aging, Less Healthy Population," by Evan Ramstad, Wall Street Journal, 22 February 2010.

Kim's legacy, as measured from the country's two most recent censuses:

1) population up from 21.2m to 24.0m

2) infant mortality up from 14.1/1,000 births to 19.3 (not bad but wrong direction, obviously)

3) maternal mortality up from 54/1,000 births to 77

4) life expectancy drops from almost 73 years to 69

5) farming remains the biggest employer at 3.4m, with the gov/mil second at just under 700k (guess that's no million-man army then), followed by education, machine manufacturing, textiles and coal mining. 40k work in electronics.

Some glimpses into the Hermit Kingdom.

The long-term rehab needs of the many outweigh the short-term emergency-room needs of the many more

WORLD NEWS: "Emergency Doctors Leave Haiti," by Ianthe Jeanne Dugan, Wall Street Journal, 24 February 2010.

Old story that Barnett Consulting (created to make this gig happen) learned while doing a Lessons Learned effort for the United Way of Rhode Island after the Station Nightclub fire: Everybody loves to donate for the immediate response, but the trick is, the long-term needs aren't adequately addressed.

In the Station Nightclub fire event, the long-term needs were rehab of burn victims. In Haiti, we're talking about all the follow-on surgeries to improve upon the outcomes of the original ER versions.

Can Turkey graduate to great power?

ARTICLE: Turkey's Leaders Seek to Defuse Crisis,
By SEBNEM ARSU and SABRINA TAVERNISE, New York Times, February 25, 2010

Next iteration on the Turkish pol-mil crisis: both sides trying to cool things down.

Worth tracking, as the effective processing of such "crises" is a hallmark of a great power.

(Via WPR's Media Roundup)

Hussein Iraqi officers back in

ARTICLE: Iraq to Rehire 20,000 Hussein-Era Army Officers,
By MARC SANTORA, New York Times, February 25, 2010

The countercharge struck me as funny:

"This is purely a means of trying to gain more votes," said Mayson al-Damalogi, a spokesman for Iraqiya, a coalition of Sunni and secular candidates headed by former Prime Minister Ayad Allawi.

To which I reply, "Yeah, your point?"

Larger point: Not bad to see the government reaching out to former officers. Can't believe the military's suffering a surfeit.

Is this not a good sign as we prepare to draw down?

(Via WPR's Media Roundup)

Beijing may not want its trophy Hummer anymore

COMPANIES & MARKETS: "Beijing set to put the brakes on Hummer deal," by Patti Waldmeir and Sundeep Tucker, Financial Times, 24 February 2010.

The Chinese government sees the deal as going against its push to get consumers into smaller cars.

Nice touch: the ever-more-environmentally-aware Chinese kill Hummer for us!

No real US-China fight

ARTICLE: U.S., China make effort to get along, By Paul Richter, Los Angeles Times, February 15, 2010

Commonsense, of course, prevails, despite the flurry of "coming clash/war" BS that the worlds of punditry and blogs recently generated. And so the wave of OMG! analyses will be replaced by a smaller wave of this-too-shall-pass.

"Many of these tensions are not new, nor is the rough patch this relationship is entering," Winny Chen, a researcher at the Center for American Progress, a think tank with close ties to the administration, wrote in an online assessment this week. Each president since Ronald Reagan has faced periods of conflict with China, she said.

Douglas Paal, a former U.S. official now at the Carnegie Endowment for International Peace, said he believes that Chinese leaders "have been careful not to do substantial damage to the relationship, while making louder noises to appease their domestic opinion." He predicted China would continue to resist efforts to impose new United Nations sanctions on Iran, probably abstaining from a Security Council vote after doing all it can to water down a punitive resolution.

Nevertheless, he said he believes that the two countries' relationship will be held together by economic interdependence and the need to work together on issues including the financial crisis, climate change and nonproliferation.

He predicted that Obama and Hu would end the year with productive meetings and that the relationship would look better in 2011.

"I can't believe the United States and China will be looking for a fight," Paal said.

But what the hell, at least we all got a column or two out of it.

(Via WPR's Media Roundup)

Good argument on North Korea

OP-ED: Magical thinking on North Korea, By Leon V. Sigal, Boston Globe, February 24, 2010

After saying it's "magical thinking" to expect NorKo to collapse, or for China to step up, or for negotiations to stop Pyongyang's nuclear cowboying-up, the Globe makes a strong pitch for an aggressive soft-kill:

The only way to get North Korea to reverse course, short of war, is to reconcile with it - ending enmity through robust political, economic and cultural engagement, investment and aid, security assurances, normalization of relations, and, above all, a peace treaty ending the Korean war.

I like anything that's aggressive against the war-criminal Kim regime. I think an aggressive opening-up campaign would be highly destabilizing for the regime, and that we'd trigger a crisis point faster that way than what we've done for the last two decades.

So I like this argument very much.

(Thanks: John P. Ryan)

Europe's done about all the fighting they're going to do

ARTICLE: Gates Calls European Mood a Danger to Peace, By BRIAN KNOWLTON, New York Times, February 23, 2010

While I agree with Gates' message, he's barking up the wrong tree, as the Dutch decision shows.

This is a clinging-to-the-past instinct that does not serve our long-term needs whatsoever.

(Via WPR's Media Roundup)

Economic pressure won't stop Iranian nuke

ARTICLE: U.S. will use banks to thwart Iran nukes, By Eli Lake, Washington Times, February 24, 2010

Perfectly fine to pursue in terms of containing/pressuring Iran in general, but it won't stop anything on the nukes.

(Via WPR's Media Roundup)

The monster that is China's rising cybercrime nets

FRONT PAGE: "People's Republic of Hacking: 'Panda' Exploit Offers Rare Inside Look at China's Cybercrime Networks," by James T. Areddy, Wall Street Journal, 20-21 February 2010.

Starts off with quick summary of infamous "Panda" hacker--the usual nerdy young man as virus creator (a misleading image we project?). The recent attacks on Google were far more sophisticated, we are told, and there's no known connection back to the Panda guy.

So why the story?

Mr. Panda (Li Jun) learned his skills within a "hacker network in China that remains an active and growing threat to global computer users." His case is considered the first case of organized cybercrime that emanated from China, so the glimpse it offered is seen as crucial to figuring out what may be going on now, to include the notion that China's government is actively recruiting from these ranks.

Why should we suspect that?

Uh, I dunno. We'd never do anything like that. Hey, I'm not quite sure I like the tone of that question!

Anyway, China denies everything, as it is wont to do.

Chinese hackers, we are told, are different from the usual American loners or those steely-eyed Russian droids (Russians are routinely cited in the industry as the best pure coders on the planet--as in, those who commit the fewest mistakes in their work). Instead, Chinese hackers each do their little part in larger schemes--members of the orchestra rather than jazz soloists.

How collective.

Naturally, bits and pieces are sold in every direction--quite cheaply.

Rest is too much narrative on Mr. Li's life.

Charts are interesting:

1) countries designated as being of "most concern" as source for cyberattacks: US still leads China--barely;

2) Malware rates on servers by country: same one-two, with US way in lead; and'

3) in terms of relaying spam, China's behind Brazil and the usual #1--America.

Of note: on all three charts, the relative predominance of New Core/Seam states (China, Russia, Peru, South Korea, Turkey, Brazil and India). Collectively they account for 13 of the top 20 named slots.

Networks dissolving and viruses spreading.

There is malware at the bottom of the internet.

Remove the virus, carry the virus.

But remove the/remove the/remove the/rerererererere

Connect Central Asia

ARTICLE: China Seeks to Link Central Asia by Railroad, By: Erica Marat, Eurasia Daily Monitor, Volume: 7 Issue: 30, February 14, 2010

While we worry over the Fergana Valley's radical Islamists movements, the real SysAdmin work of note in Central Asia emanates from China: the railroad linkage.

Logical and welcome.

(Via WPR's Media Roundup)

China pretty close to US in terms of income inequality

WORLD NEWS: "China's Efforts Narrow Gap Between the Rich and Poor," by Andrew Batson, Wall Street Journal, 3 February 2010.

Good chart on income inequality in select countries (Gini index):

From least equal to more equal, it goes:

• South Africa
• Brazil
• Chile
• Russia
• Mexico
• Indonesia
• Turkey
• China
• US
• UK
• Japan
• South Korea

So China not doing all that bad, relatively speaking, and if it's getting better, then all the better for the world as a whole. I will take a stable China over a prematurely democratic one, and the fastest way to achieve democracy there is a growing paycheck, as evenly distributed as possible.

So good news amidst all this hand-wringing and freaking-out over here.

Globalization's midlife crisis

COMMENT: "What the world must do to sustain its convalescence," by Martin Wolf, Financial Times, 3 February 2010.

Funny image from Wolf:

So what did I make of this year's annual meeting of the World Economic Forum at Davos? It felt like sitting at the bedside of somebody who had survived a heart attack but was unsure how long it would take to recover full vigor, if, indeed, he would at all.

A nice capture of where globalization is right now: settling uncomfortably into a sort of middle-age. The easy extensive growth is fading or gone completely in the Old Core, and will become progressively harder to tap (or control, inflation-wise) in New Core pillars like China. Ditto for the easy, early connecting strategies, growth of networks across the Core as a whole. Now we all settle into tougher, more complex issues.

The irony? The emerging economies overwhelming believe in an "open world economy," as Wolf puts it. Who's losing faith? The West, who really does wonder if he'll ever quite get it up as before.

That self-doubt, not the imagined "superiority" of authoritarian capitalism, is the real danger to the system right now.

Globalization goes butch

MIDDLE EAST AND AFRICA: "A debate about fashion in Qatar: Cross about cross-dressing; Is it a wicked Western habit that should be stopped?" The Economist, 30 January 2010.

Weird little story: growing subculture of women in Qatar who dress-up in very masculine style: baggy pants, short hair, deep voices. They call themselves boyat, which translates as "both tomboy and transsexual."

Naturally, the local upset press blame the "manly women" phenom on globalization! (or "globalisation" to you former Brit colonies!). The usual suspects: foreign teachers, the Internet, and sat TV. Oh, and those gnarly foreign housemaids.

Trend showing up in UAE too, and unsettling authorities there.

Here's the scary clincher:

One official describes the "deviant behaviour" of the boyat as a "menace" to society. But others sound less fazed. An American university lecturer in the region says the short hair and gym shoes worn by these women would look perfectly normal on an American campus. That is just what unnerves traditionalists.

An exporting of U.S. cultural "imperialism?" Grow up!

It's simply the unleashing of individualism among the young in these countries, and kids everywhere know exactly how to piss off their parents.

Americans may have gotten there earlier, but this is not some "export" we control.

al-Qaeda--exclusively a non-Western threat?

INTERNATIONAL: "The resurgence of al-Qaeda: The bombs that stopped the happy talk; It was too soon to say that Osama bin Laden's followers were on the wane--but pessimism should not be overdone," The Economist, 30 January 2010.

Interesting chart that belies the titling of the article: truth is that all the successful lethal attacks since the year 2005 have targeted non-Western locales.

The details:

2004 sees about 750 fatalities in al-Qaeda attacks worldwide, with roughly one-third happening in West and two-thirds in non-West, which we can interpret here as overwhelmingly the Gap.

2005 features a big jump to just over 1,600 deaths, but well over 90% are non-Western, and I'm guessing the bulk of those are Iraqis.

2006 is huge drop (makes you think methodological issues?) to less than 100--all non-Western.

2007 is maybe 375-80 (eyeballing here) and all non-Western.

2008 is about 200, and all non-Western.

There was an old bit of mine in the brief a few years back that said, after reapplying pressure on AQ through the war on terror/Afghanistan/Iraq, AQ's reach is back to being what it was for Mideast terror in general in the 1980s--likewise after the West stepped up the backpressure (all those hijackings in the 1970s and early 1980s): they can kill people with some ease in the region and neighboring areas, but reaching seriously into the West is hard and thus rare.

Yes, you will always need to guard against the danger, especially when it comes to the sleepers implanted in your society or newbies activated from among the immigrant pool, but truth be told, AQ is no more global than the collection of Mideast terror groups that got all the attention way back when, and actually enjoyed some serious support from a superpower--the Sovs.

So same basic geographic reach, with less impressive logistical capabilities.

So when the GOP gins up the "war" demand vis-à-vis the too cop-like Obama, it's really an unsubstantiated argument. We not only want the goal to be reached where we simply file terror under "crime," but we're largely already there across the Core, thanks to America's and West's willingness to take the fight where it belongs--inside the Gap regions where the struggles truly exist.

Doesn't mean we can't suffer an attack here in the States, or that we won't be in the constant, professional business of disrupting such plots (nothing new there, honestly), or that we won't have soldiers snap and go nuts like Hassan did at Hood--whatever the justification offered. It just means this is a reasonably contained threat that it should not pervert life or politics or economics or national security thinking over here (Bush was right, in many ways, to say--in effect, "go about your business, America, and leave it to the professionals"; a message not all that different from Clinton before him or Obama following him). The threat and all responses should be kept in context, with the larger goal being the preservation and expansion and improvement of the global economy.

The rest is simply peanuts, including obsessing over "authoritarian capitalism"--our latest, growing freak-out fest that represents mindless extrapolating of today's dynamics in the same sort of weak-assed analytics that we typically find in the Pentagon's threat projections (all mil, no econ; except here we're getting all econ with no politics or culture or environmental or demographics).

But we're Americans, damn it! We have to be freaking out about something all the time! I know, because these people send me emails re: the same every day. The enduring truth is that the vast majority of our nightmares never unfold, and those that do really don't change much of anything about us over the long term.

If the Internet doesn't change the way our minds think, then why do we assume social networks change the way we communicate?

SPECIAL REPORT: "A world of connections: A special report on social networking," by Martin Giles, The Economist, 30 January 2010.

The subtitle on the opening piece reads, "Online social networks are changing the way people communicate, work and play, and mostly for the better."

Now, at first glance, it's hard to argue with the analysis: social nets in the past were dominated by geeks using aliases (which I have always found distasteful), but over time they evolved into "vast public spaces" with easy-enough-to use interfaces and "fine-grained privacy controls," meaning most people nowadays feel comfortable enough to engage using actual names, etc. So instead of that early, Wild West feel, you've got what Marc Andreessen calls "a dramatic and permanent upgrade in people's ability to communicate with one another," a notion to which I subscribe.

I now maintain a weak-but-pleasantly-appropriate level of contact with a small universe of people from my past, most of whom I hadn't maintained any ties and would never have re-found absent Facebook.

Does this constitute a change in how I work or play or really communicate? Not really. I just do all those things with a wider variety of people. Similarly, Obama won voters over the same way politicians did in the past, just exploiting new technologies. But in both instances, the connecting souls behaved no differently than their predecessors.

I think one of the reasons why such connecting technologies get underappreciated or underused is that we manage to cast the whole process as some revolutionary new mode of behavior, when it's not. The same interpersonal skills apply, it's merely the scope and speed that changes.

I learned that on the blog: you don't adapt yourself to the medium, you adapt the medium to yourself, because nothing else really works and the creation of false fronts loses out over the long term to authenticity in all its glorious forms.